Nitinai Sirismatthakarn, president of the Airports of Thailand (AOT), said the third phase of the Don Mueang Airport is being considered, though the agency has to consult with the State Enterprise Policy Office (SEPO) first.

He said if the two agree with the plan, then AOT will submit the plan to the Transport Ministry before it is forwarded to the Cabinet for approval.

He said the airport’s third phase will cost Bt34.3 billion and will include the building of Terminal 3, expanding the parking lot and adjacent buildings to connect with the Red Line Skytrain, hotel and the automated people moving system.

Nitinai added that the AOT is almost ready to start a bidding for this public-private partnership investment project.

The Don Mueang International Airport currently welcomes 40 million passengers per year, but its capacity is only for 30 million, which causes congestion during rush hour. The AOT will initially work on solving urgent problems, such as increasing the areas for Visa on Arrival and immigration channels, adding more check-in counters, expanding the waiting area at the bus gate and will later consider building a terminal to accommodate 1,200 to 3,000 package tourists per hour, with the aim of having it completed by 2020.

For the construction of Terminal 3, the domestic terminal and airplane parking No 6 will have to be demolished. The AOT will also renovate Terminal 1 to accommodate as many as 22 million domestic passengers per year. Warehouses Nos 1 and 2 will also be renovated, the traffic system and aircraft parking lot expanded and the utility system improved.

Ratchada Thanadirek, deputy government spokesperson, said the Bt11 billion will be divided into Bt7.3 billion worth of government subsidies, Bt2.4 billion as domestic loans and Bt1.2 billion as income for PWA.

The projects are as follows:

1. Construction of raw-water plumbing station and water production and distribution station, including water pipes in PWA’s Ban Chang project to supply to the Eastern Economic Corridor;

2. Construction of a raw-water plumbing station and water production and distribution station to improve raw water storage capacity in PWA’s Phang Nga-Phuket branch;

3. Construction of a raw-water plumbing station and production and distribution station as well as the laying of water pipes at the Udon Than-Nong Kha-Nong Bua Lamphu branch;

4. Construction of a raw-water plumbing station and water production and distribution station including laying of water pipes at Mae Sai branch (Huay Krai-Mae Chan-Chiang Saen) to supply the special economic zone;

5. Construction of raw-water plumbing station, water chute and water production and distribution station as well as laying water pipes at the Nakhon Si Thammarat branch;

6. Construction of raw-water plumbing station and water production and distribution station including the laying of water pipes in the Kantang branch (Sikao-Pak Meng).

These projects are scheduled to be ready for use by 2021 and should provide water for an additional 239,618 users with an increased supply of 332,400 cubic metres of water per day.

Some merchants, he said, had smuggled 100,000 tonnes of glutinous rice into the country  from Vietnam via Thailand’s neighboring countries, adding that they were then mixed with Thai glutinous rice before going on sale in the local market.

Thai sticky rice is currently priced at Bt45,000-46,000 per tonne or Bt45-46 per kilogram while it could rise to US$ 1,500/tonne in export,  compared to  $600 per tonne  or Bt18-19 per kilogram in Vietnam. Thus, smugglers stand to make a profit of Bt25 per kilogram.

Some merchants have been  arrested and charged for their wrong-doing, with some smuggled batches weighing up 30 tonnes each.

The quality of Vietnamese sticky rice is lower than their Thai counterpart as it tends to turn crumbly, not sticky, when cooked.  However, their quality improve when mixed with Thai produce.

If consumers feel the quality of glutinous rice is not good enough,  they can assume that they were smuggled in from Vietnam, Chukiat said.

However, Chukiat said  it is widely believed that the  price of sticky rice would have risen to Bt 60-70 per kilogram if not for the smuggling.

Recently, the price fell to Bt 40-41/ kilogram with the launch of packaged bags, targeting  low-income people.  Also, merchants have refrained from price speculation due to strict stock checking and the fact that  the new harvest of glutinous rice will enter the market next month.

Wichai Phochitkit, director-general of Internal Trade Department said  the new supply will soon be released into the market, adding that the department will set the appropriate price as it has a direct impact on farmers’ income.

It is reported that Thong Fah shops and the local communities have pushed the Ministry of Commerce for  further releases of  glutinous rice bags through the Department of Internal Trade.

The ministry has been releasing glutinous rice stock since 11 September. However, it has yet to reach   consumers  in many parts of the country while supply to Thong Fah stores will be delivered  this wee

Energy Minister Sontirat Sontijirawong said after a meeting that the measure would take effective tomorrow (September 18).

The reduction was a step in preparation for a possible surge in local oil prices after the drone attacks on two major oil-processing facilities of Saudi Arabia’s Aramco.

Sontirat added that the attacks in Saudi Arabia will prompt the global crude oil price to peak at between US$60 and $70 per barrel, adding that the cut in the Oil Fund’s contribution is sufficient to deal with the situation.

He also said that in case the global oil price spikes beyond $70 per barrel, he will call a meeting with the committee again to launch more measures, though he said he is confident the price will not exceed $70 per barrel.

The aim of the MoU is to push for the successful implementation of cross-border offerings of securities that link both countries’ capital markets. The deal is the result of a fruitful discussion between the two agencies in early August this year and is being seen as an important milestone to reflect strong bilateral ties as well as to further strengthen a previous MoU signed in 2014.

The latest MoU covers the establishment and setting up the functions of a task force to work on the process of implementing cross-border equity offerings and the issuing of debt receipts. It also covers guidelines for those who wish to offer securities both in Thailand and Cambodia.

“Cambodia and Thailand are well connected in economic, social and cultural terms,” said Ruenvadee Suwanmongkol, SEC secretary-general, said. “Both SEC Thailand and the SECC also have been enjoying a friendly, cooperative relationship both at bilateral and multilateral levels over the past several years.

“The MoU signed today marks a significant milestone in enhancing capital-market cooperation between the two regulators to make a strong contribution to the successful implementation of cross-border equity offering and debt receipts with the aim of allowing issuers from both countries to list or make an offer of their equity securities outside the issuer’s home jurisdiction,” she said.

“With this strong collaboration, it is expected that a corporation from Cambodia will become the first foreign company listed on the Stock Exchange of Thailand, after the SEC regulation on cross-border equity offering became effective in 2015. Debt receipt is another financial instrument that has been received with great interest by businesses in both countries. Thus, we strongly believe this MoU will create greater business opportunities as well as sustainable growth and prosperity of the region.”

Sou Socheat, director general of SECC, said: “The additional MoU signing marks a long friendship, market development and cooperation between SECC and SEC Thailand. This MoU will provide alternative ways for companies both in Cambodia and Thailand to have access to capital, help expand the issuers’ businesses, increase their liquidity derived from trading in more than one exchange and access to larger pool of potential investors.

“In addition, we are sure this MoU’s implementation will lead to a good model for cooperation in the region and we are optimistic that capital markets in the region will grow together.”

The drone strikes early on Saturday on the Abqaiq processing facility and the Khurais field caused 5.7 million barrels per day of crude production – nearly 60 per cent of Saudi Arabia’s current production – to be shut down.

The Abqaiq facility processes around 7 million b/d of crude, making it Saudi Aramco’s largest oil processing facility. Khurais is the second-largest oil field in that country, with a capacity to pump around 1.5 million b/d of crude.

Front-month Brent crude futures on ICE jumped 20 per cent to $71.95 (Bt2,192) per barrel on September 16 in an initial reaction to the attacks.

S&P Global Platts Analytics expects Brent prices to test the high $70s/barrel previously forecast, if not higher.

This incident signals a significant escalation by Iran-backed groups, which until now have demonstrated awareness of critical infrastructure such as the east-west pipeline and the Strait of Hormuz, while having limited impact, Platts Analytics said in a report, adding that the output disruption indicates an alarming level of effectiveness and sophistication, and more importantly a change in tactics towards a more direct and serious offensive.

“While in the short term the direct physical impact on the market might be limited, this should move the market away from its bearish macroeconomic cycle and raise the risk premium in the market as funds reduce their short positions,” said Chris Midgley, global head of Analytics at Platts.

The sudden change in geopolitical risk warrants not only an elimination of the $5-10/barrel discount on bearish sentiment, but adds a potential $5-10/barrel premium to account for now-undeniably high Middle Eastern dangers to supply and the sudden elimination of spare capacity, Midgley said.

Underscoring the market’s vulnerability to supply-side risks, Platts Analytics estimates that global spare capacity is currently at 2.3 million b/d, but more than 1.6 million b/d of that is in Saudi Arabia.

Asian consumers not panicking yet

Following the attack, Saudi Arabia was quick to assure buyers of its crude, with newly appointed Energy Minister Prince Abdulaziz bin Salman saying the kingdom’s customers would be supplied from its stocks.

The International Energy Agency also said that for now the markets are well-supplied with ample commercial stocks, and US President Donald Trump said on Sunday that he had authorised a release of US strategic oil stocks “if needed, in a to-be-determined amount” to keep the oil market well supplied following the attack on Saudi Arabia’s oil plants.

Asian oil consumers are also unlikely to press the panic button for now as major Saudi crude buyers in both Northeast and South Asia hold adequate oil reserves, while companies have a wide range of alternative supply sources.

Chinese state-run and independent refiners said the companies expect the Saudi supply disruption to be short, while China’s current inventory could cover any near-term shortfall. In addition, China is more than capable of sourcing medium and heavy sour crudes outside the Middle East.

South Korea’s rigorous efforts to diversify crude imports will hold it in good stead. South Korea saw the share of Middle Eastern crude in the monthly procurement basket fall below 68 per cent in recent months, compared with more than 85 per cent in 2015, data from Korea National Oil Corp showed.

South Korea is capable of sourcing medium and heavy sour crude elsewhere, for example from Mexico and Russia’s Urals.

In South Asia, Indian refiners’ wide range of crude import sources and flexible feedstock procurement strategies mean that companies are more concerned about a potential global price spike than the cutback in Saudi supplies.

The extent and duration of the shutdown was not immediately known, but if the reduction persists, Asia is expected to be the hardest hit.

While all major Asian importers have SPRs and other type of crude stocks as cushions, the challenge is the length of the potential disruptions as Asia is vulnerable to a prolonged absence of lower crude supplies from Saudi Arabia, according to Platts Analytics.

An extended outage from Saudi Arabia could also have OPEC reassessing its plans to tighten compliance with crude production quotas.

The oil producing bloc had just announced on September 12 that it would keep its 1.2 million b/d supply cut agreement with Russia and nine other allies unchanged through its scheduled expiry of March 2020, though with improved adherence by Iraq and Nigeria to their quotas. The UAE had also declared its intent to lower its production to over-comply with its committed cut.

“In the short term, Saudi Arabia will be able to maintain exports and use reserves in Japan to ensure supply security, but any evidence of prolonged disruption of production would heavily impact OPEC spare capacity and the ability of the IEA to use strategic petroleum reserves to shore up the market,” Platts Analytics said.

Mriganka Jaipuriyar is head of news, Asia, S&P Global Platts.

The new generation is spending too much.

That’s the point Bank of Thailand Governor Veerathai Santiprabhob tried to get across at the seminar “The Royal Initiative: Immunity for Thai Economic Structure” in Bangkok on Monday.

Veerathai said that the household debt was increasing dramatically, partly from the first car policy and the zero per cent retail loan competition.

A look into the behaviour of Thais found that they are spending more money and are incurring higher debts. This was especially so for the new generation, who have just graduated and started to work but are overspending and likely to shop online, he said.

The low interest rates for quite some time now have discouraged the incentive to save, Veerathai said. The central bank is therefore trying to encourage more savings by issuing personal credit card regulations, loan-to-value measures, and opening debt-settlement clinics.

More than 40 per cent of farmers are still poor, with an average monthly income of Bt4,750, and they are moving to cities to work, so it’s time to believe in the sufficiency economy approach, which must be followed immediately, Veerathai said.

The household debt is currently high at Bt12.9 trillion – 78.7 per cent of the gross domestic product, according to the central bank.